Straight Talk for Seniors®: What the Bipartisan Budget Act of 2018 Means for Seniors

On Feb. 9, Congress passed and the President signed into law the Bipartisan Budget Act of 2018. The legislation lifts funding caps and makes some positive Medicare changes, thanks to NCOA’s advocacy. But it also cuts and leaves out other important programs. Here’s our analysis.

Funding for Aging Services

Perhaps the most important development is that the new law lifts the budget caps imposed by the Budget Control Act of 2011 for both FY18 and FY19. This is the fourth time Congress has enacted a temporary reprieve from the budget caps, and this increase is the largest.

Of the almost $300 billion in new spending, $63 billion is for domestic or non-defense discretionary (NDD) programs in FY18, with another $68 billion in FY19. The law also raises caps on defense spending by $80 billion in FY18 and $85 billion in FY19.

This may look like significant new spending on NDD programs. But, in reality, it fails to make up for the last 10 years of cuts. Adjusted for inflation and total population growth (not just seniors), the new NDD total in FY18 is still 11% below its comparable level in 2010.

With the new spending levels set, Congress now has until March 23 to craft an omnibus package to enact all 12 FY18 appropriations bills. Some new investments that have already been prioritized include $3 billion to combat the opioid crisis, $1 billion for the National Institutes of Health, and “adequate” funding for the Social Security Administration to ensure constituents are served.

NCOA is working to ensure that the omnibus also removes threats posed to some key aging services programs. The House had proposed eliminating the Medicare State Health Insurance Assistance Program (SHIP) and cutting $100 million from the Senior Community Service Employment Program (SCSEP), $3 million from Chronic Disease Self-Management Education (CDSME), and $2 million from the Elder Justice Initiative.

Health Program Extensions

The Bipartisan Budget Act also features several positive changes to Medicare. These include:

Benefits Outreach: The act extends for two years (at current levels of $37.5 million) funding for outreach and enrollment for low-income Medicare beneficiaries originally authorized under the Medicare Improvement for Patients and Providers Act (MIPPA). NCOA played a leadership role in securing this funding, which is allocated to SHIPs, Area Agencies on Aging, Aging and Disability Resource Centers, and the National Center for Benefits and Outreach Enrollment. The act also requires the Administration for Community Living to report on the amount and use of the $13 million in MIPPA funds provided to states through the SHIP allocation, but this does not apply to annual SHIP appropriations of $47 million.

Therapy Services: The law permanently repeals the Medicare payment cap for therapy services.

Donut Hole: The act closes the Medicare Part D coverage gap, or “donut hole,” one year earlier. Beneficiary contributions will decrease to 25% of prescription costs in 2019, instead of 2020.

In-Home Care: The law extends the Independence at Home Demonstration Program by two years and increases the number of participating beneficiaries from 10,000 to 15,000. It also improves access to Medicare telehealth services.

Special Needs Plans: The act makes Medicare Special Needs Plans (SNPs) permanent. SNPs target enrollment to one or more special needs individuals, including those who are institutionalized, dually eligible for Medicare and Medicaid, or living with severe or disabling chronic conditions.

Chronic Illness: The law expands Medicare Advantage supplemental benefits to meet the needs of chronically ill enrollees. These benefits would be required to have a reasonable expectation of improving or maintaining the health or overall function of the chronically ill enrollee and would not be limited to primarily health-related services.

Unfortunately, the budget act does NOT include other provisions that NCOA and aging advocates were seeking. NCOA and other national organizations will continue to urge Congress to include these in the March omnibus package:

Long-Term Services & Supports: The act does not extend the Medicaid Money Follows the Person program, which expired on Sept. 30, 2016. It has assisted states in transitioning over 75,000 Medicaid enrollees from nursing facilities back to community-based settings. Sens. Portman (R-OH) and Cantwell (D-WA) have introduced S. 2227 to make improvements and extend the program for five years.

Part B Enrollment: The law does not include the bicameral, bipartisan Beneficiary Enrollment Notification and Eligibility Simplification (BENES) Act (S. 1909; HR 2575), which would improve the Medicare Part B enrollment process.

To help pay for many of the new spending items, the act also includes a variety of program cuts. Of particular concern to older adults are:

Medicare Premiums: The act increases the percentage that Medicare beneficiaries with incomes of at least $500,000 ($750,000 for couples) must pay in Medicare Part B and Part D premiums from 80% to 85% of costs.

Next Steps

With appropriators working to finalize FY18 funding in March, NCOA will be advocating that, at a minimum, proposed cuts in aging services should be reversed. Learn more about how you can help defend these programs. NCOA also will continue to advocate for the Money Follows the Person program. You can help by sending a letter to your members of Congress. Shortly after these issues are resolved in March, Congress will turn its attention to the FY19 budget process. The Administration released its budget request on Feb. 12.